For taxable years beginning after December 31, 2017 and before January 1, 2026, the deduction for moving expenses and the exclusion for qualified moving expense reimbursement is suspended, except for members of the Armed Forces of the United States on active duty who move pursuant to a military order and incident to a permanent change of station.

IRC code section 217 allowed an above-the-line deduction for moving expenses paid or incurred during the tax year in connection with the commencement of work by the taxpayer as an employee or self-employed individual at a new principal place of work. IRC section 217 is amended by IRC section 11049.

The moving expense deduction is reported on Form 3903 and flows to Schedule 1 line 26.

Program Details:

Entering Qualified Moving Expense Reimbursement:
  1. Go to Screen 10, Wages, Salaries, Tips.
  2. Within the Box 12 input fields enter a Code P - Excludable moving expense reimbursements along with the dollar amount reported on W-2.
  3. Go to Screen 27, Moving Expense (3903).
  4. Enter all applicable moving details.
  5. Mark the box Armed forces move due to permanent change of station to generate Form 3903.

Diagnostic Warnings:

Form W-2 #: Excludable moving expenses reimbursements were linked to Form 3903, but the "Armed forces move due to a permanent change of station" box was not selected, making the move non-deductible for federal. (ref. #50965)
Form 3903 #: Only members of the Armed Forces are allowed moving expense deductions. If you are a member of the Armed Forces, please return to the Moving Expense screen and select "Armed forces move due to permanent change in station." (ref. #50961)

Related Topics:

Generating Form 3903 Moving Expenses (Click Here to view)

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